Gold and Silver Prices Dip on Strong Dollar and Rising Yields

Gold and silver prices opened lower on the Multi Commodity Exchange (MCX) on Tuesday, driven by a stronger US dollar and rising Treasury yields. The decline came despite reduced expectations of a Federal Reserve interest rate hike in October. Gold futures for December 2026 delivery dropped by Rs 415 to Rs 1,49,901 per 10 grams, marking a Rs 1,500 decline over two days. Silver futures for the same delivery date fell by Rs 1,000 to Rs 2,25,127 per kg.

The US dollar's strength made gold and other dollar-denominated commodities more expensive for holders of other currencies. Meanwhile, yields on 10-year and 30-year US Treasury bonds reached 24-year highs on Monday, reflecting continued weakness in the bond market. Data released on Friday showed slower-than-expected US job growth in September, which weakened expectations of a rate hike this month. Traders now price an 87% probability of a rate increase in December, according to CME's FedWatch Tool.

Separate data indicated that US services sector activity slowed in September, with inflation pressures remaining elevated into 2027. In the Middle East, Saudi-backed Yemeni government forces advanced to retake coastal areas around the Bab el-Mandeb Strait from Iran-backed Houthis. Internationally, spot gold was down 0.3% at $4,128.69 per ounce, while US gold futures were little changed at $4,156.00. Spot silver declined 0.6% to $60.67 per ounce, platinum fell 0.7% to $1,710.08, and palladium eased 0.2% to $1,170.15.

Manoj Kumar Jain of Prithvi Finmart noted that gold has support at $4,134-4,110 and resistance at $4,184-4,200 per troy ounce. Silver has support at $60.60-60.00 and resistance at $62.40-63.00. On the MCX, gold has support at Rs 1,48,800-1,48,100 and resistance at Rs 1,49,900-1,50,350, while silver has support at Rs 2,24,400-2,22,000 and resistance at Rs 2,27,700-2,29,500. Jain suggested traders wait for market stability before taking fresh positions, while long-term investors could accumulate gold and silver during the market fall.